use urban outfitters 2018/2019 annuals
Using the financial ratios provided in Table 4.1 and following the financial statement information presented for Urban Outfitters, Inc., calculate the following ratios for Urban Outfitters for both 2018 and 2019: a. Gross profit margin b. Operating profit margin c. Net profit margin d. Times-interest-earned (or coverage) ratio e. Return on stockholders' equity f. Return on assets g. Debt-to-equity ratio h. Days of inventory i. Inventory turnover ratio j. Average collection period Based on these ratios, did Urban Outfitter's financial performance improve, weaken, or remain about the same from 2018 to 2019 Profitability ratios 1. Gross profit margin 2. Operating profit margin (or return on sales) Sales revenues - Cost of goods sold Sales revenues Sales revenues - Operating expenses Sales revenues or Operating income Sales revenues Profits aftertaxes Sales revenues Shows the percentage of revenues available to cover operating expenses and yield a profit Shows the profitability of current operations without regard to interest charges and income taxes. Earnings before interest and taxes is known as EBIT in financial and business accounting Shows after-tax profits per dollar of sales. 3. Net profit margin (or net return on sales) 4. Total return on assets Profits after taxes. Interest Total assets Profits after taxes Totalassots Profits after taxes Total stockholders' equity 5. Net return on total assets (ROA) 6. Return on stockholders' equity (ROE) 7. Return on invested capital (ROIC)- sometimes referred to as or on capital A measure of the return on total investment in the enterprise. Interest is added to after-tax profits to form the numerator, since total assets are financed by creditors as well as by stockholders. A measure of the return earned by stockholders on the firm's total assets. The return stockholders are earning on their capital investment in the enterprise. A return in the 12% to 15% range is average. A measure of the return that shareholders are earning on the monetary capital invested in the enterprise. A higher return reflects or bottom-line effectiveness in the use capital Profits after taxes Long-term debt + Total stockholders'equity